The Illusion of Inclusion |
The employment-linked incentive scheme reproduces existing labour market asymmetries by prioritising subsidies to firms over investment in workers. The ELI sidesteps the structural problems of skills mismatch, informality, and declining employment elasticity in manufacturing. By rewarding headcounts without ensuring job quality, it risks producing statistical illusions of employment rather than substantive work. Worker-centred alternatives focused on human capital, social security, and dignified employment are proposed.
India’s employment crisis has been widely described as one of jobless growth, with rising gross domestic product (GDP) failing to translate into adequate or secure jobs (Mehrotra 2020; Kannan and Raveendran 2019). Despite structural shifts in the economy, nearly 90% of the workforce remains in informal employment (NSSO 2023), while manufacturing has failed to absorb labour at scale, reflecting trends of premature deindustrialisation (Rodrik 2016). Several policy initiatives, such as Skill India, Pradhan Mantri Kaushal Vikas Yojana, and the production-linked incentive (PLI) scheme, have attempted to address this challenge but have delivered limited results (Mehrotra and Parida 2019).
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